Morgan Stanley Lowers Galaxy’s Rating Due to Unexpected Decline in Macau’s General Market Share
Wednesday 17 de April 2024 / 12:00
2 minutos de lectura
(Macau).- Investment bank Morgan Stanley has downgraded Macau’s Galaxy Entertainment Group (GEG) from Overweight to Even-weight, citing the absence of mass market share gains since the opening of Galaxy Macau Phase 3 and anticipating further market share losses in 1Q24.
In a Wednesday note, analysts Praveen Choudhary and Gareth Leung said they were now 13% below consensus on GEG’s expected EBITDA in both 2024 and 2025 because consensus had assumed mass market share gains as a result of Phase 3 that did not materialize.
They added that consensus also has Galaxy’s 2024 mass market share at 20%, 170bps higher than the 18.5% it achieved in 2H23. Instead, Morgan Stanley believes GEG’s mass market share in 1Q24 will actually decline further to 17.7%, noting “potential operating deleverage as the company increases opex to gain market share and for non-gaming investment.”
Despite this loss in share, the analysts observe that GEG continues to trade at a premium to its Macau peers to the tune of 12% over Sands China and 20% over the rest, likely due to its net cash position and expectations of growth from Phase 3 and the upcoming Phase 4 development.
Nevertheless, while the bank believes GEG’s EBITDA growth will be slower than its peers in 1Q24, it added “we might turn more positive if we saw a more visible trend of market share gains from 2H24 on.
“Galaxy has a very strong track record in running and ramping up operations. Also, some investors favour its net cash position amid an uncertain China macro.”
Morgan Stanley has cut its Target Price on GEG shares by 17% to HK$38.
Categoría:Gaming
Tags: Sin tags
País: Macao
Región: Asia
Event
GAT EXPO CARTAGENA DE INDIAS 2024
09 de April 2024
AI: The new ace in the hole for the games of chance industry
(Cartagena, Exclusive SoloAzar).- One of the conferences held within the recent GAT EXPO, brings to the table a topic that is on everyone's lips: Artificial Intelligence (AI). This year, the panel entitled “Artificial Intelligence in the Entertainment Industry” was held with the presence of prominent experts from Latin America.
Tuesday 30 Apr 2024 / 12:00
Why to invest in Paraguay?
(Cartagena de Indias, Exclusive SoloAzar) - During the conferences organised at the GAT EXPO 2024 fair, Dr. Carlos Augusto Liseras Osorio, president of the National Gaming Commission, (CONAJZAR, in its original) asked this tacit question, to highlight the advantages and benefits of investing in the Republic of Paraguay, and also notifying the audience about the upcoming tenders for 7 land-based casinos in that country.
Monday 29 Apr 2024 / 12:00
Novomatic's innovative offerings and market insights: a recap of our presence at GAT Expo 2024
(Cartagena de Indias, SoloAzar Exclusive).- Manuel Del Sol - CEO at NOVOMATIC Gaming Colombia, gave an overview during the interview with SoloAzar, focusing on the innovative products presented at the event, the good reception from visitors, insights on the Colombian iGaming market, the latest technological trends incorporated into the platform, and the firm's approach to regulatory adaptation in the Latam market.
Friday 26 Apr 2024 / 12:00
SUSCRIBIRSE
Para suscribirse a nuestro newsletter, complete sus datos
Reciba todo el contenido más reciente en su correo electrónico varias veces al mes.